Small Connecticut hospitals to get state aid, but some call it smoke screen

Susan Haigh Associated Press

Published 9:56 am, Saturday, October 10, 2015

HARTFORD >> Connecticut will redistribute $14.1 million to help smaller, financially strapped hospitals in the state, but not the larger hospitals, which already have healthy margins, Gov. Dannel P. Malloy’s budget office said Friday.

The Office of Policy and Management said hospitals in Bristol, Torrington, Derby, Putnam, Stafford and Milford hospitals will receive the payments, ranging from $3.3 million for Derby’s Griffin Hospital to $736,870 for Milford Hospital. The figures are based on numbers of Medicaid clients.

Friday’s announcement comes amid an ongoing battle between the Democratic governor and the state’s hospitals over cuts in state funding to help cover the cost of health care for the poor. Despite the promise of $14.1 million, the battle will likely continue because Malloy has already said he will eliminate payments to hospitals — both big and small — for the last three quarters of the fiscal year to help balance the state budget.

“This is simply a political smoke screen to cover up and divert attention from the devastating $190 million in cuts he unveiled two weeks ago,” said Jennifer Jackson, CEO of the Connecticut Hospital Association. “Let’s be clear,” she said. “This is a Band-Aid on a bone-deep wound.”

Budget officials said the $14.1 million is a combination of state and federal money, and includes about $6.9 million the small hospitals were due to receive anyway. The $14.1 million will come from first quarter Medicaid reimbursement payments the state has not yet released to Connecticut’s 28 hospitals. The first payments could be made in December.

Meanwhile, it’s unclear whether the larger hospitals will receive any money for Medicaid expenses they’ve already incurred this fiscal year, which began July 1. The administration said it has not decided what to do with a remaining $50 million.

Malloy and his administration have made it clear they’re unsympathetic to the complaints of the larger hospitals, who’ve said the cuts have resulted in layoffs and program reductions.

“We know that hospitals are not one-size-fits all, and that’s why we’re proactively reprioritizing and reallocating dollars to support smaller hospitals that need support most,” said budget secretary Ben Barnes, adding how the other 15 larger hospitals made in excess of $900 million in profits — a figure that’s disputed by the Connecticut Hospital Association.

“The six small hospitals we are helping today lost millions in fiscal year 2014, and we’re proactively working to support them,” said Barnes.

The hospitals had expected to receive about $256 million in so-called “supplemental Medicaid payments” in the new fiscal year. About one-third of the money comes from the state while the remainder includes federal reimbursement. But about three months into the fiscal year, Malloy announced plans to cut the final three quarters of payments, which total about $192 million. He said the budget needed to be adjusted to address fluctuations in the stock market.

Reaction to Friday’s announcement from state legislators was mixed. While a couple whose districts include the smaller hospitals said they were grateful for the money, minority Republican leaders criticized the funding as a “token action” and both the top Democratic legislative leaders said more needs to be done.

“Simply reshuffling already overdue payments for the first quarter toward hospitals is not an adequate resolution and amounts to randomly picking winners and losers,” said House Speaker Brendan Sharkey, D-Hamden, adding how Democrats plan to recommend alternatives for Malloy to consider.